The Wealth and Poverty of Nations Analysis

The Wealth and Poverty of Nations

In THE WEALTH AND POVERTY OF NATIONS: WHY SOME ARE SO RICH AND SOME SO POOR, David Landes, professor emeritus of history and economics at Harvard University, attempts to answer the dilemma posed in the book’s subtitle. In his discussion, Landes is destined to raise hackles in portions of the academic community, because it is his contention that all civilizations and all societies are not necessarily of equal importance, at least in contributing to the origins of the modern world. As George Orwell said in another context, some are more equal than others, and for Landes that is the West.

It is his thesis in THE WEALTH AND POVERTY OF NATIONS, which refers to Adam Smith’s THE WEALTH OF NATIONS (1776), that the cultural characteristics of a society’s history is the key to explaining success, particularly economic success, in today’s global world. In a wide ranging historical survey covering the last millennium, Landes explores the differences between the West and the Middle East, Asia, Africa, and Latin America. The West succeeded because of the totality of its past experiences, including political, religious, social, technological, economic, and geographical aspects. In contrast, Landes contends that China was too self-satisfied, turned inward, and lacked the competitive curiosity of western culture, and the Middle East has been in thrall to Islam, in comparison to the division between the religious and secular worlds which evolved in the West.

Landes predicts no miracles regarding the future, and he leaves the reader uncertain about whether “the Rest” will ever catch up with the West. THE WEALTH AND POVERTY OF NATIONS is worth reading, both in explaining how we possibly got where we are and by alluding to the difficulties in breaking from the past.

Sources for Further Study

Commonweal. CXXV, May 22, 1998, p. 19.

The Economist. CCCXLVII, May 16, 1998, p. S5.

Foreign Affairs. LXXVII, March, 1998, p. 128.

Harvard Business Review. LXXVI, July, 1998, p. 171.

The Journal of Economic History. LVIII, September, 1998, p. 857.

The New York Review of Books. XLV, April 23, 1998, p. 37.

The New York Times Book Review. CIII, March 15, 1998, p. 15.

ORBIS. XLII, Fall, 1998, p. 631.

Publishers Weekly. CXLV, February 9, 1998, p. 84.

The Times Literary Supplement. August 14, 1998, p. 25.

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The Wealth and Poverty of Nations

David Landes is professor emeritus of history and economics at Harvard University and the author of several other wide-ranging histories, including Bankers and Pashas (1980), a study of nineteenth century Egypt, Unbound Prometheus (1969), and Revolution in Time (1985). In his most recent work, The Wealth and Poverty of Nations, Landes gives an answer to one of the most intriguing historical questions: Why did the forces of Western civilization, notably European civilization, play the major role in the creation of the modern world? The Scientific Revolution, the Industrial Revolution, the market economy, a secular society, constitutional government—modernity as a whole had its origins and maturation in the West and then spread over much of the rest of the world, becoming the paradigm, if sometimes reluctantly, for many non-Western countries by the end of the twentieth century. As Landes admits, even to ask the question is to go against the current received wisdom of the times, which posits that all cultures and all civilizations are valuable in their own right and that none is superior to any other. Landes refuses to accept such premises, and thus The Wealth and Poverty of Nations is an outrageously politically incorrect book. As he states, it is the story of the West and the Rest.

By his book’s title, it is apparent that Landes sees his study in the tradition of Adam Smith’s The Wealth of Nations, first published in 1776. It has often been claimed that Smith’s famous study is at least as revolutionary in its influence as the other revolution of that year occurring across the Atlantic. Landes quotes Smith in 1817: “. . . the causes of the wealth and poverty of nations—the grand object of all enquiries in Political Economy.” Smith, writing in the earliest stages of Great Britain’s Industrial Revolution, was one of the prophets of the market economy, of laissez-faire, of individualism, of rational self-interest. He argued against the prevailing economic assumptions and practices of earlier centuries in the West, which, under the system of mercantilism, saw the responsibility for and direction of the economy as lying in the hands of government.

Assuming that Landes is correct in his assertion that all societies are not equal in the making of the modern world and that some—the nations of the West—are more equal than others, what is his explanation? Broadly speaking, it is in what he calls “cultural differences,” past and present. Varied cultural attributes explain, in his opinion, why some nations become rich and modern and some do not. Like his politically correct peers, he recognizes cultural diversity, but in important categories, he denies cultural equality, even within Europe: “Europe’s development gradient ran from west to east and north to south, from educated to illiterate populations, from representative to despotic institutions, from equality to hierarchy.”

The West, if a late starter compared to civilizations in the Middle East and Asia, began with certain geographic advantages. The climate and the lack of debilitating extremes of temperature kept invidious tropical diseases at bay (Landes notes, however, that modern science and technology can compensate for geographical negatives). One Western development that he believes to be crucial was the concept of private property; in most earlier and some modern despotisms, the state belonged to the ruler. With private ownership, Landes argues, individual self-interest encouraged change, progress and development. The result was the evolution of the market economy.

The Judeo-Christian heritage was equally significant, according to Landes. The respect for manual labor, the concept of the subordination of nature to humanity (not always a positive, perhaps), a teleological sense of linear time—all were in contrast to the cultures and societies of the rest of the world. Education and literacy, both of which he also sees in part as a result of the Judeo-Christian tradition, were particularly manifested in the Protestant Reformation, which replaced the authoritarian church with the Bible, necessitating a literate laity. Landes also goes against the current professorial grain and accepts Max Weber’s theory of the Puritan work ethic, a concept largely dismissed by most recent critics. In China, in contrast, only the elite few studied Confucius and the other sages in hopes of joining the emperor’s ruling bureaucracy. Also important was the historical separation between church and state: the mandate to “render unto Caesar the things that are Caesar’s” was reinforced in the Middle Ages in the struggles among the bishops of Rome, kings, and emperors. In Islam, Landes argues, a largely theocratic society was both implicit and explicit from its seventh century...